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C & C North America Inc. v. Natural Stone Distributors LLC

Court of Appeals of Tennessee, Jackson

December 10, 2019

C & C NORTH AMERICA INC. D/B/A COSENTINO
v.
NATURAL STONE DISTRIBUTORS LLC ET AL.

          Session September 18, 2019

          Appeal from the Chancery Court for Shelby County No. CH-16-1671 JoeDae L. Jenkins, Chancellor

         Appellant appeals the trial court's order quashing its attachment and garnishments, whereby Appellant sought payment of its judgment from interpleaded funds that were owed to Appellee. Affirmed.

         Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed and Remanded

          Ronald D. Krelstein, Germantown, Tennessee, for the appellant, Natural Stone Distributors, LLC.

          Nicole D. Berkowitz, R. Spencer Clift, III, and W. Preston Battle, IV, Memphis, Tennessee, for the appellee, Seven Stone Surface Fabrication, LLC.

          Kenny Armstrong, J., delivered the opinion of the court, in which J. Steven Stafford, P.J., W.S., and Carma Dennis McGee, J., joined.

          MEMORANDUM OPINION [1]

          KENNY ARMSTRONG, JUDGE

         I. Background

         This is the second appeal of this case. In the interests of consistency and judicial economy, we recite the relevant factual and procedural history as set out in our first opinion, C & C North America, Inc. d/b/a Cosentino v. Natural Stone Distributors, LLC, et al., 571 S.W.3d 254 (Tenn. Ct. App. 2018) ("Cosentino I"):

C&C North America, Inc. d/b/a Cosentino ("Cosentino") is a Delaware corporation that manufactures stone surfacing products. Seven Stone Surface Fabrication, LLC, ("Seven Stone" [i.e., Appellee in the instant appeal]) had its principal place of business in Georgia but conducted business in Tennessee pursuant to a "Fabrication Agreement" authorizing it to fabricate, market, sell, install, and service Cosentino products. Over time, the parties conducted business in accordance with the Fabrication Agreement, and Cosentino incurred 88 invoices reflecting that it owed Seven Stone $153, 008.34. Before this amount was paid, however, Seven Stone was administratively dissolved by the secretary of state.
Cosentino and Seven Stone had also conducted business with Natural Stone Distributors, LLC ("Distributor[s]" [i.e., Appellant in the instant appeal]), a Tennessee company with its principal place of business in Shelby County. Pursuant to a separate contract, Distributor[s] was authorized to sell Cosentino products to authorized fabricators. Seven Stone had submitted a credit application to Distributor[s] in order to purchase goods on credit and subsequently made a number of its purchases from Distributor[s]. When Seven Stone was administratively dissolved and owed an outstanding balance on its account, Distributor[s] threatened to file an attachment action against Cosentino in Texas against the funds Cosentino owed to Seven Stone.
On October 27, 2016, Cosentino filed a complaint for interpleader in the chancery court of Shelby County pursuant to Tennessee Rule of Civil Procedure 22.01 . . .
Cosentino's complaint for interpleader named as defendants Seven Stone and Distributor. According to the complaint for interpleader, Cosentino was in possession of $150, 000 "that both defendants allege is their property." According to the complaint, Distributor alleged that Seven Stone owed it $135, 000 plus accumulated charges. The complaint stated that because of the conflicting claims, Cosentino was in doubt as to which of the defendants was entitled to the property and feared that it may be exposed to double or multiple liability. The complaint stated that Cosentino took no position on the issue of ownership of the funds and wished to pay the funds into court so that the defendants could be required to interplead and settle the matter between themselves. . .
The following day, before either defendant answered, the trial court entered an order permitting Cosentino to interplead the funds, as it "appear[ed] to the court that [Cosentino] admits liability for the amount of money forming the subject of this action but is in doubt as to who is entitled thereto." The order enjoined the other parties from instituting any other action against Cosentino with regard to the funds.
Distributor[s] filed an answer and cross-complaint against Seven Stone. Distributor[s] . . . alleged that Seven Stone had purchased goods from it on credit and incurred an outstanding balance of $130, 665.13, plus accrued finance charges, for a total of $139, 310.06 due as of October 31, 2016. Distributor[s] alleged that this sum remained unpaid despite ...

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